New transaction platform for mutual funds to be unveiled by BSE
For being eligible to buy and sell mutual funds directly through the new platform, IFAs will need to pay a one time fee of Rs. 15,000. For the investor, it implies no additional burden other than the usual demat charges. Meanwhile, platform for brokers in the industry will continue to run.
For the investor
As mutual funds through transaction on the stock exchange are available only in dematerialized form, an investor needs to compulsorily maintain a demat account. And upon submission of requisite details pertaining to demat account number, PAN, bank account details and phone number with the exchange and following verification with the depository you can begin to transact in mutual fund through your distributor or IFA.
Payment for the MF transaction to be routed using the IMPS service of NPCI
For, the payment for the transactions in mutual fund via the new BSE StAR MFD platform, BSE will deploy the Interbank Mobile Payment Service (IMPS) of the National Payment Corporation of India (NPCI). NPCI is a government-led entity engaged in consolidation of several retail payment solutions.
For effecting the payment, you need to register your mobile number with your bank. Following the completion of the registration process, the bank generates an m-PIN in addition to a MMID or mobile money identifier of 7 digits. For executing the fund transfer, you should be knowing the MMID of the receiver which in the case is BSE. Payment process can then be completed using the m-PIN through the IMPS-routed mobile banking.
The other modes of payment that can be used for effecting fund transfer for mutual funds include the usual real-time gross settlement (RTGS) or national electronic fund transfer (neft). But the IMPS facility scores over other payment routes as the payment settlement through the channel can be executed 24*7. Not to forget, there exists a cut-off time for placing the purchase order for the mutual fund.
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